Economist Testifies On the Negative “Spillover” Effects of Predatory Gambling

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Economist Loretta Fairchild testified at a hearing in the Nebraska legislature in October 2011 to express her findings that the costs of predatory gambling significantly outweigh any benefits. She also notes that gambling “is one of a very small number of consumer items that economics considers as ‘special cases,’ because almost all types of gambling do have significant ‘spillovers’ on to people who don’t provide the gambling or use it, and these spillovers are mainly negative, harmful ones, on to families, friends and other businesses.”

Testimony of Economist Loretta Fairchild to Nebraska Legislature

CkirbyEconomist Testifies On the Negative “Spillover” Effects of Predatory Gambling
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Nobel-Prize Winning Economist Paul Samuelson on Gambling

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“There is a substantial economic case to be made against gambling…it involves simply the sterile transfers of money or goods between individuals, creating no new money or goods. Although it creates no output, gambling does nevertheless absorb time and resources. When pursued beyond the limits of recreation, where the main purpose after all is to “kill time,” gambling subtracts from the national income.”

From Economics, 6th edition, 1970

CkirbyNobel-Prize Winning Economist Paul Samuelson on Gambling
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Predatory Gambling Operators Profiting Off of High School Football

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In October 2011, the Pittsburgh Tribune-Review reported that a group of gambling websites in Costa Rica offers betting odds on high school football games in the state of Pennsylvania. The newspaper reports that the town of Shaler’s athletic director Paul Holzshu had “disgust” for websites and bookies that offer betting opportunities on games teenagers play.

“It sounds to me like we are at the mercy of people who don’t give a damn about the educational quality of what we’re doing,” Holzshu said. “They’re just trying to make a buck off kids who are innocent. People are exploiting kids by betting on games.”

High School Football Betting Rankles Pennsylvania Athletic Officials

CkirbyPredatory Gambling Operators Profiting Off of High School Football
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Mass. Lottery Officials Knew and Encouraged Manipulation of Game

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The Boston Globe exposed that just three groups of bettors accounted for most of the winning tickets statewide for the lottery game Cash WinFall. Massachusetts Lottery officials initially said they were surprised to learn that just a handful of gamblers had taken over the $2 games and announced new rules to limit the dominance of sophisticated bettors.

Upon further investigation, the Globe “has found that lottery managers for years allowed and some say even encouraged the groups to manipulate the game, Cash WinFall. They provided extra ticket machines and printers to accommodate the biggest player, a retired store owner from Michigan, so he could buy more tickets faster. Gerry Selbee, whose gambling group spent millions of dollars on the game, said the regional director in Western Massachusetts personally thanked him for propping up flat lottery sales.”

Mass. Lottery Officials Helped High Rollers See Windfalls

CkirbyMass. Lottery Officials Knew and Encouraged Manipulation of Game
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Penn National Finds a Way to Market to Problem Gamblers

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In 2008, the Illinois Gaming Board fined Hollywood Casino, owned by Penn National, $800,000 for marketing to customers who put themselves on the state’s self-exclusion list. “As part of a campaign to develop new customers, the casino rented a list of names from a firm that operates ATM machines at Illinois casinos. In January, the casino mailed promotional materials, including coupons to use at Hollywood Casino, to nearly 15,900 people identified as prospective customers. However, the casino’s marketing department failed to check the list against the names of people enrolled in the Gaming Board’s Self-Exclusion Program. The board said 146 people in the program received the mailing.”

Penn National Fined $800K for Marketing to Banned Gamblers

CkirbyPenn National Finds a Way to Market to Problem Gamblers
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Atlantic City Sees Large Growth in Poverty

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While predatory gambling operators around the nation are still selling the idea of “destination resorts,” it is important for citizens to consider how one of America’s most well-known destination resort is faring. The 2009 article below from the Press of Atlantic City reports that the “city’s population fell slightly to 34,769 in 2008, down from 35,770 in 2007 – but the percentage of families living in poverty grew to 24 percent from 19 percent in the same period.”

Atlantic City’s Poverty

CkirbyAtlantic City Sees Large Growth in Poverty
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The Definition of Addiction Changes

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The American Society of Addiction Medicine has a developed a new way of classifying addiction. “The definition, a result of a four-year process involving more than 80 leading experts in addiction and neurology, emphasizes that addiction is a primary illness – in other words its not caused by mental health issues such as mood or personality disorders, putting to rest the popular notion that addictive behaviors are a form of “self-medication” to, say, ease the pain of depression or anxiety.”

This new definition refutes a great deal of research funded by predatory gambling operators that claim that gambling addicts are merely suffering from another form of mental illness and that they would simply substitute a gambling addiction with another addiction.

A Radical New Definition of Addiction Creates a Big Storm

CkirbyThe Definition of Addiction Changes
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NBA Hall of Famer Bill Bradley Speaks Out Against Sports Betting

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NBA Hall of Famer and former U.S. Senator Bill Bradley has been a consistent opponent of sports betting. In fact, he helped pass the Professional Amateur Sports Protection Act of 1992, which banned the practice in all 50 states, with a few exceptions.

It was an incident in his professional basketball career that helped shaped his view.

“We were ahead by five points or so, the opponent hit a basket to cut the lead to three points, and I heard cheering,” Bradley said of the seemingly meaningless basket as the game was ending. “I asked why, and someone said they were cheering because [the other team] covered the point spread…I know that when I was a player, I certainly didn’t like the idea of being a roulette chip.”

Man Behind Sports Betting Ban Stands His Ground

CkirbyNBA Hall of Famer Bill Bradley Speaks Out Against Sports Betting
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Poker Bots Taking Over Online Gambling

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Kurt Eggert, a professor at Chapman University School of Law is concerned that consumer protection is becoming extremely difficult as cheaters use “poker robots,” advanced intelligence programs, to tilt the tables.

“I know of no way to prevent somebody from having a bot on one computer telling him what to play on another computer,” Eggert said. “This is a huge problem for the industry in that recreational gamblers don’t want to go on their poker sites and get killed by somebody using a bot, and that is going to happen more and more as bots get smarter and smarter.”

“There are international competitions now to design the best poker-playing bots and they are doing a darn good job,” Eggert said.

Chairwoman Says Go Slow On Legalizing Web Poker

CkirbyPoker Bots Taking Over Online Gambling
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Disney and Florida Chamber of Commerce Oppose Florida Gambling Expansion

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The state of Florida often markets itself as a family friendly destination, attracting millions every year to Orlando’s Walt Disney World. That image could change if Florida lawmakers allow predatory gambling giants like Genting, Las Vegas Sands, and Wynn to bring commercial casinos to the state. The state’s tribal casinos oppose the idea because they don’t want the competition, but civic leaders and the Florida Chamber of Commerce fear the kind of economic development that casinos would bring. “The only reason they are even targeting Florida is that they are hopeful that desperate people will reach for desperate measures,” said Mark A. Wilson, the Chamber president. “There is never a good time to push a bad idea.”

In Florida Battle, Casino Cash v. Disney Image

CkirbyDisney and Florida Chamber of Commerce Oppose Florida Gambling Expansion
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